The Google Fiber Honeymoon Period Appears To Be Over

from the the-disruption-that-only-half-arrived dept

When Google Fiber first arrived back in 2010, it was heralded as a gamechanger for the broadband industry. Google Fiber would, we believed, revolutionize the industry by taking Silicon Valley money and using it to disrupt the viciously uncompetitive and anti-competitive telecom sector. Initially things worked out well; with the mere mention of a looming Google Fiber target market resulting in a much-needed conversation about why the United States consistently languishes in mediocrity when it comes to our broadband networks (pro tip: it's because AT&T, Verizon and Comcast all but own state and federal lawmakers).

Seven years later, however, and the Google Fiber bloom appears to be off the rose. There's little doubt that Google Fiber brought some much-needed competition to countless markets, driving down costs and spurring deployment of gigabit networks in key areas (though these benefits are often over-hyped, and broadband competition in countless markets is actually getting worse). There's also no doubt that Google Fiber has been of great benefit to disadvantaged communities, thanks to free deployment of gigabit broadband to anchor institutions and low-income housing developments.

That said, the company has gone through two CEOs in a matter of months, laid off an unspecified number of employees during a restructuring last fall, and has begun to show signs that the company's dedication to the project is wavering at best, and notably derailed at worst. Reports began to circulate last fall that high-level Alphabet execs were bored with the slow pace and high cost of fiber deployment, and were considering pivoting the entire Google Fiber business model to wireless. But the company's messaging regarding this transition has been anything but clear, only driving unease among those waiting for the promised revolution.

"Kansas City expected to become Google's glittering example of a futuristic gig-city: Half a decade later, there are examples of how Fiber benefitted KC, and stories about how it fell short. Thousands of customers will likely never get the chance to access the infrastructure they rallied behind, and many communities are still without any broadband access at all. Many are now left wondering: is that it?

"We were saying that in all likelihood this is too good to be true," said Isaac Wilder, co-founder of the Free Network Foundation and a Kansas City native..."Lo and behold, just a few years later and it's beginning to become clear that [Google Fiber] was just a lot of lip service," Wilder told me.

To be clear a lot of Google Fiber's problems are not the company's fault. AT&T, Comcast, and Charter have filed numerous nuisance lawsuits designed to slow the company's use of city and telco-owned utility poles, and protectionist state laws pushed by these same companies often hinder attempts at public/private partnerships with cities. Meanwhile, the company's murky messaging is in part thanks to the fact that Google Fiber has so many various wireless experiments in the oven, it's not really sure which of these technologies are going to pan out -- making publicly communicating the project's future direction a notable challenge.

In short, it's possible that Google Fiber successfully pivots to next-generation wireless and fulfills at least some of the lofty promises made early on in the Google Fiber life cycle. But based on the conversations I've had with industry insiders, there would be little surprise if in a few years Google Fiber sold off the entire project to a second-tier telco like CenturyLink, then shifted its focus -- like countless hugely-successful giants before it -- more toward turf protection of its legacy markets.

Reader Comments

Seems to be the standard path companies take. Start as an innovative, disruptive force, seize a huge chunk of the market pie, consolidate and become the protectionist evils of yesterday. Just wait till Google starts patent/copyright trolling. The market is ripe for disruption on many fronts now.

It's sad that Fiber stalled. While it's easy to lambast Google for it, any other company would have failed way sooner. The ones to blame are actually the beloved, functional and generally awesome big ISPs, with Comcast as their shiny knight. If anything I hope the frustration translates into activism against these companies.

Re:

And regulation will be there for these companies to buy for themselves. Since they had to face an uphill battle with regulation while they were "innovative" they are naturally going to use their financial might to rig the system in their favor when they can.

You would do the same thing in their shoes.

And no, the frustration is NOT going to translate into activism against the companies. All we need to do is boycott them and eventually the market will correct.

The problem is that everyone are cowards and will not do without things for a little while to send the necessary messages to the market.

Right now the message is fuck us raw, we will only bitch just a little and try to send a politician you can easily buy to protect us.

Re:

KC

The KC rollout is not on hold. There are still many getting new connections right now. Others are delayed as Google is testing fixed wireless in KC and hard to reach areas are likely to get wireless when it rolls out next year.

Take Advantage of the Rebuilding.

In the aftermath of Hurricanes Harvey and Irma, there is, I suppose one would call it, an "agitation" to put power lines underground, where they are less vulnerable to extreme weather events. Storm drains will have to be made better. This is unavoidably going to involve large sums of government money. Given the scope of burying, say, a three-thousand-volt electric power cable, adding in a dozen or so plastic ducts is not going to be a big deal. Possibly, by such means as may be developed, this may be leveraged towards municipal provision of internet access.

I can envision circumstances under which Comcast might prefer to surrender its franchise in certain areas, rather than pay a "fair share" towards rebuilding expenses.

Open access

The "honeymoon period" ended when they went back on their promise of making this an open-access network. Originally they'd promised that third-party internet/TV/phone providers would be able to provide service over their fiber, and IIRC that customers could use more than 1 at a time.

Re: Re:

"I don't understand what you are saying."

You must first know what you are talking about to understand it.

There is ZERO free market for telecom! Regulation destroyed it before most of us were even born. And protectionist laws are regulations. Regulation = Law, they are the same thing, so try to rebuke others without contradicting yourself next time, genius!

Re:

Re:

Having some difficulty reading? From the article:

To be clear a lot of Google Fiber's problems are not the company's fault. AT&T, Comcast, and Charter have filed numerous nuisance lawsuits designed to slow the company's use of city and telco-owned utility poles, and protectionist state laws pushed by these same companies often hinder attempts at public/private partnerships with cities.

Mike is well aware of the problem that regulation plays with the ISP market. In an ideal world we'd get rid of that regulation and foster an actual competitive market of ISPs. Failing that, however, FCC regulation of the existing monopolies is the next-best option.

Taken out of context

"she revealed that the company cancelled her broadband service over a 12 cent dispute, a rather Comcast-esque failure by the company"

You left out the "The disconnect was caused by an automated system and Google Fiber fixed the problem with in an hour of being notified and gave the lady a $30 credit on her account for the trouble.", and they're putting in safety measures to prevent it from happening again. Nothing "Comcast-esque" about that.

Mistakes happen, it's how you deal with those mistakes that makes you Comcast-esque.

I don't want to say it but...

I told you so.

Google has become the "low hanging fruit" company when it comes to new business ideas. They generally start up well, often "big", and then as soon as they hit anything that suggests a headwind, they first ignore the project and the drop it.

It's why they tended to call everything "beta". It gives them an out on everything.

Google also doesn't do customer service very well. Having to deal with customers (aka, people, not machines) is not their strong suit.

Finally, it comes down to the numbers. Being an ISP is expensive, and installing service once it gets a little more difficult can get pricey. The income and the "extra" value of getting people to Google products didn't seem to add up to much. While they don't break Google Fiber out individually in their financial reports, we do know that their "moonshot" businesses absolutely lost their collective asses, year on year. Had Fiber been a big financial winner, you can be sure they would be crowing about it. Losing their asses on something that will take a decade or more to start to pay out is NOT the Google way.

I have said it before, and I will say it again: If Google can;t stomach the costs of becoming an ISP, I can't imagine too many other companies lining up to get there.